 "Price rise in ethanol fuels one in industrial alcohol")
Contrary to the usual trend during the peak cane crushing season, prices of industrial alcohol have risen by at least five per cent in two weeks, with user sectors raising their offer price to secure supplies.
Normally, the price of industrial alcohol, a byproduct of the making of sugar, declines during December on excess supply from operational mills. With a gradual decline in cane supplies towards the end of the crushing season by March, the price of industrial alcohol starts moving up.
However, a new fear is presently driving prices and worries on supply — the fear of industrial alcohol’s diversion for ethanol production. Since the government raised ethanol prices by Rs 1.50–2 a litre in November, chemicals manufacturers and potable alcohol bottling plants have started signing pacts with sugar mills for future supply.
“Its prices have gone up by Rs 2 a litre, unusual during this time. Most surprisingly, the elevated price level has sustained this year. Normally, the price eases during December–January, due to the increase in supply when cane crushing picks up,” said Sanjay Tapriya, chief financial officer of Uttar Pradesh-based Simbhaoli Sugars.
Industrial alcohol is currently trading at Rs 36-38 a litre in UP and Rs 34-36 a litre in Maharashtra.“There is a supply fear in the market since the government raised ethanol prices to Rs 48.50-50 a litre across the country. Users might be booking in advance at a higher price to secure supply,” said an analyst.
A CARE Ratings report said, “Sugar companies are already realising up to Rs 44 a litre for supply of industrial alcohol.”
Industrial alcohol is distilled ethyl alcohol, normally of high proof. It is produced and sold for other than beverage purposes. It is usually distributed in the form of pure ethyl alcohol, completely denatured alcohol and proprietary solvent blends. Ethyl alcohol or ethanol can either be produced by direct fermentation of cane juice or from molasses, a byproduct of sugar making. In India, ethanol can legally be produced only from molasses. Mills in Brazil produce it directly from sugarcane juice.
Ethanol can be used for the potable alcohol industry, the chemical industry and as a biofuel in vehicles, either directly or blended with petrol. In India, ethanol is consumed primarily by the potable alcohol industry, oil marketing companies (for blending with petrol) and chemical industries. In Brazil, it is primarily utilised as a vehicle fuel, either directly as hydrous ethanol or anhydrous ethanol blended with petrol.
Normally, the price of industrial alcohol, a byproduct of the making of sugar, declines during December on excess supply from operational mills. With a gradual decline in cane supplies towards the end of the crushing season by March, the price of industrial alcohol starts moving up.
However, a new fear is presently driving prices and worries on supply — the fear of industrial alcohol’s diversion for ethanol production. Since the government raised ethanol prices by Rs 1.50–2 a litre in November, chemicals manufacturers and potable alcohol bottling plants have started signing pacts with sugar mills for future supply.
“Its prices have gone up by Rs 2 a litre, unusual during this time. Most surprisingly, the elevated price level has sustained this year. Normally, the price eases during December–January, due to the increase in supply when cane crushing picks up,” said Sanjay Tapriya, chief financial officer of Uttar Pradesh-based Simbhaoli Sugars.
Industrial alcohol is currently trading at Rs 36-38 a litre in UP and Rs 34-36 a litre in Maharashtra.“There is a supply fear in the market since the government raised ethanol prices to Rs 48.50-50 a litre across the country. Users might be booking in advance at a higher price to secure supply,” said an analyst.
A CARE Ratings report said, “Sugar companies are already realising up to Rs 44 a litre for supply of industrial alcohol.”
Industrial alcohol is distilled ethyl alcohol, normally of high proof. It is produced and sold for other than beverage purposes. It is usually distributed in the form of pure ethyl alcohol, completely denatured alcohol and proprietary solvent blends. Ethyl alcohol or ethanol can either be produced by direct fermentation of cane juice or from molasses, a byproduct of sugar making. In India, ethanol can legally be produced only from molasses. Mills in Brazil produce it directly from sugarcane juice.
Ethanol can be used for the potable alcohol industry, the chemical industry and as a biofuel in vehicles, either directly or blended with petrol. In India, ethanol is consumed primarily by the potable alcohol industry, oil marketing companies (for blending with petrol) and chemical industries. In Brazil, it is primarily utilised as a vehicle fuel, either directly as hydrous ethanol or anhydrous ethanol blended with petrol.